Seacom, which will become operational in less than three weeks, is widely seen as a catalyst to lower international bandwidth pricing and hence improved broadband offerings. Seacom will be the first direct competitor to Telkom’s SAT3\/SAFE system which enjoyed a monopoly in the South African international bandwidth market for years.<\/p>\n
While consumers may eagerly await drastic price cuts in coming months, significant international bandwidth price reductions have in fact already occurred. Telkom’s Chief of Strategy Naas Fourie told MyBroadband that recent price reductions mean that the company’s SAT3\/SAFE bandwidth pricing is in line with Seacom’s published rates.<\/p>\n
Telkom also does not seem particularly keen on Seacom, giving a strong indication that it feels its immediate international bandwidth needs are well served by the SAT3\/SAFE system. Fourie said that Telkom did not buy any capacity on the Seacom submarine cable system, but that the company has invested in both the EASSy and WACS cable systems. <\/p>\n
One industry source said that despite the fact that there have already been substantial price cuts on international bandwidth, Telkom has indicated that it will undercut Seacom’s pricing to retain their business. <\/p>\n
These price cuts are likely to benefit broadband consumers in the long run with lower bandwidth pricing and\/or higher usage limits. Telkom has in fact already increased their standard usage limits on its own ADSL accounts, something which consumers may see from more service providers.<\/p>\n